Singapore boasts of highest gross per capita financial assets in Asia: Allianz

SINGAPORE boasts of having the highest gross per capita financial assets in the region last year, beating Japan, Taiwan and India by quite a fair margin.

According to the sixth edition of Allianz's Global Wealth Report 2015, Singapore's gross per capita financial assets - an indication of how mature an economy is - had by the end of 2014 risen to around 106,620 euros (S$170,000), more than 10 times as high as in China and more than 100 times as high as in India.

The city-state witnessed a 6.4 per cent growth in its gross financial assets last year, slightly slower than in previous years. The strongest growth was reported in life and pension assets (9 per cent), while securities in private households' portfolio increased by only 1.2 per cent and bank deposits by 6.1 per cent.

Allianz said the need to save for old age was reflected by the structure of asset portfolios, where almost half of all assets are held in life and pensions assets; no other Asian country invests more in this asset class. On the other hand, liability growth also slowed down further to 5.4 per cent in 2014. Nonetheless, the debt ratio (liabilities as percentage of gross domestic product) continued to climb; with 75.5 per cent it is clearly above the regional as well as the global average, according to the report.

Hot in the heels of Singapore were Japan and Taiwan, with average assets corresponding to the equivalent of around 95,000 euros and 88,000 euros respectively. In China, per capita financial assets are still lingering below the regional average of around 10,600 euros, just like in Thailand (5,900 euros), Indonesia (1,160 euros) and India (1,040 euros).

However, after deductions for liabilities, Japan emerged the country with the highest net per capita financial assets in Asia, with the equivalent of just under 73,550 euros attributable to each inhabitant in 2014.

With net financial assets per capita of 73,330 euros on average, Singapore retained its rank of ninth in international comparison as in the previous year, moving up by five rungs since 2000.

"The per capita figures hide what are often considerable differences in wealth distribution in these countries. But even taking these inequalities into account, the strong increase in gross financial assets on the one hand, coupled with weaker credit growth on the other, has increased the proportion of people who were considered members of the wealth middle class in 2014, i.e. the group of people with net financial assets of between EUR 6,100 and EUR 36,700," Allianz said, adding that at the end of 2014, one in five people, or 20.4 per cent, fell into this category.

The net financial assets of 2.4 billion people in the region, however, came in at less than 6,100 euros, that is the proportion of the population with low assets amounted to 76.7 per cent, while 94 million or only 2.9 per cent of the population had net financial assets in excess of 36,700 euros.

Allianz report, which measured 2014 wealth, found 2014 was the third consecutive year in which global wealth grew more than 7 per cent, with an estimated 136 trillion euros in personal financial assets.

For the first time, Allianz calculated each country's wealth Gini coefficient - a measure of inequality in which zero is perfect equality and 100 would mean perfect inequality, or one person owning all the wealth. It showed the distribution structures in Asia were slightly more egalitarian than elsewhere, the (simple) regional average of the Gini coefficient stands at 62.7 against a global average of 63.8. The value for Singapore is 64.8 - only slightly above the average for Asia.